New charitable zeal grips tech billionaires

Jon Swartz

USA TODAY

SAN FRANCISCO — Shortly after Facebook CEO Mark Zuckerberg visited San Quentin State Prison to speak out about overcrowded prisons this month, word quickly spread that Twitter CEO Jack Dorsey was donating a sizable amount of the riches expected from the forthcoming IPO of Square, his other company, to underserved communities.

In an industry often derided for its selfish, self-aggrandizing behavior, the good works of Zuck and Jack were heartening, though not entirely surprising. HBO's hit sitcom Silicon Valley aside, the Valley is increasingly putting its money where its heart is.

"The story is that not just the big guys are giving," says Alison Murdock, who has done philanthropic work in the region for years. "There has been a backlash against Silicon Valley, and nobody wants to be a jerk."

Thursday, Zuckerberg and his wife, Priscilla Chan, launched a multimillion-dollar private preschool, K-8 school and health services for children and families in impoverished East Palo Alto, Calif.

Wednesday, Radha Basu, the former general manager of Hewlett-Packard's $1.5 billion channel business, announced that iMerit, the company she founded to help train and prepare millions of marginalized youth in the USA and India for the digital jobs of the future, raised $3.5 million. She's enlisted the help of Michael and Susan Dell, venture capitalist Vinod Khosla and eBay founder Pierre Omidyar.

"How can we bridge the IT industry and employ youth in skilled digital services?" Basu says. "Think of this as a bridge between Silicon Valley and youth."

The intersection of tech and philanthropy — some in Silicon Valley call it “philanthrocapitalism" — is epitomized by e-commerce site YouGiveGoods, which lets people “e-give” tangible goods to causes and start charity drives of their own.

Company CEO Lisa Tomasi, who created the site, has worked with the NFL, Morgan Stanley and Verizon to help organizations such as Toys for Tots and SPCA shelters.

The young turks of tech lead the charge, though they learned plenty from the Hewlett and Packard families, Google, Salesforce and others before them, says Sharon Tanenbaum, a non-profit consultant in the San Francisco Bay Area.

"San Francisco, by far, is the most generous city in the U.S. per capita," says Ben Nelson, CEO of Minerva Project, which provides students an Ivy League education for a fraction of the price. "What's important is for tech millionaires to give as its billionaires have."

Indeed, not just the mega-wealthy in tech are giving generously: Increasingly, executives from start-ups are pledging time and money to social causes.

Many have learned from the dot-com boom of the late 1990s, when the tech industry was dinged for a paucity of donations.

Zuckerberg and Chan contributed $992.2 million in company stock to the Silicon Valley Community Foundation in 2013. EBay chairman Pierre Omidyar, Google co-founder Sergey Brin and Microsoft co-founder Paul Allen each contributed more than $200 million to non-profit groups in 2013. Oracle CEO Larry Ellison kicked in $72.2 million.

Netscape Communications co-founder Jim Clark chipped in $60 million. All of them have been among America's top 50 donors over the years, according to The Chronicle of Philanthropy.

Microsoft co-founder Bill Gates and investor nonpareil Warren Buffett have spearheaded a campaign to get other American billionaires to give at least half their wealth to charity. The Bill and Melinda Gates Foundation is the largest private foundation in the world, with a $41 billion endowment.

Then again, history forgets that Bill Gates was roundly criticized for "being stingy," Nelson says, as he built Microsoft into a multibillion-dollar behemoth. Once he attained ultra-wealth status, he plunged into philanthropy and fundamentally changed it.